How Fair is the AirFAIR Act?

Congress says disaster airfare should be regulated, but airlines disagree

In the aftermath of 2017 hurricanes Harvey and Irma, Congress was swift to take action in helping those displaced by the storm. While emergency funding and aid were expedited to the affected areas, a New York congresswoman offered a different form of support.

On September 12, 2017, House Resolution 3473 – the “AirFAIR Act” – was introduced to the 115^th Congress by Rep. Nydia M. Velázquez. The bill seeks to prevent airlines from imposing “…an excessive increase in the price of such tickets in circumstances related to a disaster or emergency,” capping price increases to 30 percent and tasking the Federal Aviation Administration (FAA) Administrator with studying price hikes during times of crisis. Prices would be capped when a disaster or emergency is declared by states, territories, and possessions of the United States, as well as the District of Columbia.

Prior to the landfall of Irma, airlines stood accused of artificially raising prices as a result of demand. Flyers attempting to get out of the storm took to social media, reporting fares ranging from $547 to over $3,200. Is it time for Congress to step in to reign in airfare prices?

In previous situations, airlines have been given little mandate as to what they can and cannot do for flyers. Traditionally, carriers have offered trip change waivers ahead of known catastrophic events, giving the option to change plans without charge. The number of flyers affected depends on the spread of the crisis: A 2011 report by MarketWatch highlighted the wide difference in policies based on carriers.

However, those operating the aircraft compare the proposed regulations to airline regulations – similar to those seen in the ‘70’s. In an editorial published by Roll Call, Airlines for America president Nicholas E. Calio compared the “regulation” in other industries, questioning if the same “fair” standard could be posed to coffee or other commodities.

“This history is instructive as members of Congress consider a return to our regulatory past,” Calio wrote in Roll Call. “The amendment being proposed today would actually reverse the 1978 law signed by President Jimmy Carter that deregulated the airline industry and gave birth to the aviation system that serves America so well today.”

In truth, airfares are lower, on the whole, today than they were years ago. A previous argument about airline pricing was backed by data from the U.S. Department of Transportation Bureau of Transportation Statistics, showing domestic airfare has decreased despite airline consolidation. The data does not adjust based on disasters and other crises.

Because of the lack of uniform rules, airlines face, setting basic protections for those trying to get away from emergencies may be a necessity. While carriers attributed the shifts to automated models and noted their ability to make manual changes, having a pre-established rule keeps evacuees and airlines on the same level. Discovering a model that works for everyone will be a challenge, as carriers work to avoid regulation, similar to the work to avoid previous FAA reauthorization packages and airport fee increases.

Would AirFAIR protection be good for flyers? Yes. Unfortunately, it may be quite a while before those come to fruition. Hopefully, both sides will find a medium before another disaster hits.